Can Intel Live up to the Hype This Year and Shoot Through $100?

Core Viewpoint - Intel's earnings report on January 22 showed revenue and EPS beating consensus expectations, but disappointing Q1 guidance led to a negative market reaction [1][2]. Financial Performance - Revenue for the quarter was $13.67 billion, exceeding the consensus of $13.39 billion - Non-GAAP EPS was $0.15, surpassing the consensus of $0.08 - Q1 guidance is projected at $11.7-12.7 billion, with a midpoint of $12.2 billion, falling short of the expected $12.53 billion [1][6]. Market Reaction - Following the earnings report, Intel's stock price fell back to $48 in post-market trading, reversing earlier gains [2]. - The market's disappointment stemmed from the lower-than-expected Q1 guidance despite positive revenue figures [1][2]. Demand and Capacity Issues - Revenue declined 4% year-over-year, and GAAP EPS was reported at -$0.12, with expectations of worsening to -$0.21 in Q1 2026 [3]. - Management indicated strong customer demand exists, but Intel is currently facing capacity constraints [5][7]. - The company is working to build out infrastructure to meet this demand, which is seen as a positive sign for future growth [4][5]. Future Outlook - The guidance for Q1 is viewed as manageable, with potential for sales to exceed the previous consensus if capacity issues are resolved [6]. - Intel's long-term outlook is optimistic, with expectations of improved performance by 2026 as capacity increases and demand is met [8]. - Significant investments from Nvidia and the U.S. government are expected to support Intel's recovery and growth [9]. Investment Consideration - Current stock price below $50 is seen as a favorable entry point for investors, with potential for significant appreciation if Intel can capture foundry market share [10][11][12].